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News channels join hands with cable networks

News channels join hands with cable networks

Author | Source: The Economic Times | Saturday, Sep 24,2005 8:21 AM

News channels join hands with cable networks

The cut-throat rivalry between news channels has reached a point where competitors are inking 'carriage' deals with cable networks. The deal includes a commitment to slot them in the frequency of other popular news channels. This ensures a readymade audience and displaces the competitor to a lesser-used frequency.

Alarmed at these monopolistic practices through the grey area of carriage fees, the Telecom Regulatory Authority of India has directed all large cable networks to provide a genre-wise audited statement of all receipts of carriage fees from broadcasters. For instance, many viewers in south Mumbai were surprised to find business channel CNBC replaced by NDTV Profit on the same slot. CNBC wasn't been taken off air, but was moved to another frequency.

Sources said NDTV has struck an annual 'carriage' deal with Hathway Network in Mumbai for around Rs 1.5 crore for its three news channels, and with the Seven Stars network in the western suburbs for around Rs 60 lakh. The deal also included replacing, wherever possible, CNBC with 'Profit', sources said.

A senior NDTV distribution executive conceded that these carriage deals had, in fact, been inked, but denied that it included replacing the CNBC slot with 'Profit'. “The arrangement is to ensure NDTV channels are in a visible frequency,” he said. CNBC-TV18's CEO, Harish Chawla said he was not aware of any specific complaints but did not rule out the possibility of these ground level wars. “This madness will continue till we have digitalisation,” he told ET.

“The carriage fees being paid by the news channels desperate for more viewership is greater than the entertainment channels,” Ravi Singh, president of the Federation of Cable Operators Associations, told ET. Speaking for SitiCable, he said there was always pressure from news channels to give them a slot of a popular news channel. This provides a “readymade audience” since most viewers don't bother to re-tune their TV sets.

“While carriage fees is fairly universal today, agreeing to swap channels depends on the personal inclinations of individual cable operators,” Mr Singh clarified. STAR News was among those who had lost out in the connectivity game, and its reach was less than NDTV India and Aaj Tak as its budget for carriage fees was smaller than the others, cable industry sources said.

The scramble for visibility among these channels has been dictated by the fact that the carriage capacity of most cable networks with a 850 Mhz system allows for a maximum of 100 analog channels. While around 60 channels in the prime and colour bands are visible, there is usually a deterioration of those that are beyond these frequencies.

Ashok Mansukhani, executive director of Hindujas' INCable Net and spokesperson of the MSO Alliance of big cable networks, claimed that Trai had been convinced that “carriage fees is a very small percentage of our revenue, and it had agreed to withdraw the directive to file quarterly audited statements of collection of carriage fees.”

Mr Mansukhani said the 'carriage fee' phenomenon was temporary. “Once the digitalisation by the cable networks is complete, carriage capacity would go up to 500 channels. Payment of carriage fees would therefore become redundant, he added. He denied that INCableNet was a party to the channel placement wars between broadcasters, but conceded that local cable operators may be taking sides.

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